Question

How much would $100, growing at 5% per year, be worth after 75 years? a. $3,689.11b. $3,883.27c. $4,077.43d. $4,281.30e. $4,495.37

Answer 1

Answer : The amount after 75 years will be, (b) $3883.27

Explanation :  Given,

Principle = $100

Time = 5 years

Rate = 5 %

Formula used :

$A=P(1+\frac{R}{100})^t$

where,

A = amount

P = principle  = $100

R = interest rate  = 5%

T = time  = 75

Now put all the given values in the above formula, we get:

$A=P(1+\frac{R}{100})^t$

$A=\ 100(1+\frac{5}{100})^{75}$

$A=\ 3883.27$

Therefore, the amount after 75 years will be, $3883.27

Answer 2

Answer: the correct answer is b. $ 3,883.27

Explanation: the formula of compound interest is Cn = C1 (1 + i) elevated to "n" where Cn is capital plus accumulated interest, C1 is the original capital, i is the interest rate, and n is the number of years. So the calculation is:

Cn = $100 * ( 1 + 0.05) elevated to 75  

Cn = $100 * 38.8326

Cn = $3,883.27